The headmaster (Henry Stram, far left) disciplines his students in the rock musical "Spring Awakening." The show's two-week run last summer (a West Coast premiere) was a big hit for the Balboa. (John R. McCutchen / Union-Tribune)

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The headmaster (Henry Stram, far left) disciplines his students in the rock musical "Spring Awakening." The show's two-week run last summer (a West Coast premiere) was a big hit for the Balboa. (John R. McCutchen / Union-Tribune)

When downtown's Balboa Theatre opened its doors for the first time in 1924, it was still five years before the stock-market crash would usher in the Great Depression.

The 21st-century incarnation of the Balboa has turned out to have precious less time to find its feet before the onset of a devastating economic slump. The historic Spanish Revival house, meticulously restored by the city of San Diego's downtown redevelopment agency (through tax increment financing and tax-exempt bonds) at a cost of $26.5 million, reopened in January 2008 and has faced struggles ever since.

According to figures provided by San Diego Theatres, the nonprofit corporation that operates the Balboa on the public's behalf, the theater has run a deficit of $412,314 from opening day through this past February. The theater's income was about 22 percent short of expenses. Revenues during the period totaled $1,449,885.

The gap between revenues and expenses has narrowed since the theater's first six months of operation, but the former vaudeville house's financial picture still is not close to what those behind its revival hoped for when the place reopened after decades of neglect and disuse.

“It's not quite what any of us went into this expecting,” acknowledges Donald M. Telford, president and CEO of San Diego Theatres. “But it's an investment for the long-term future of San Diego and downtown, and we try to keep that perspective on it.

“Our original projection and goal was that we could operate on a break-even basis. We could have (accomplished that) had the bookings and ticket sales been as originally anticipated. It's not on the expense side – it's really the number of events, and the magnitude of events, where the shortfall lies.”

It seems certain that the dismal economy is a key reason bookings and business have been hard to come by. But other factors may be at play as well, including the competition among venues downtown, the match between prospective audiences and programming, and the inherent limitations of the Balboa itself.

The theater does have some built-in programming; it's now the home (or sometime home) to such organizations as Mainly Mozart, Classics for Kids, California Ballet and the San Diego Men's Chorus.

Broadway/San Diego, the local arm of the Nederlander Organization, also brings Broadway touring shows to the Balboa, as well as to the nearby Civic Theatre, which San Diego Theatres also operates. (The Beatles tribute “Rain” closes today at the Balboa; the comedy “Tuna Does Vegas” runs there May 5-10.)

In August, Broadway/San Diego had a major success at the Balboa with the West Coast premiere of the pioneering Broadway hit “Spring Awakening,” a show not only well-sized for the theater but whose 19th-century setting seemed a natural fit for the Balboa's vintage elegance.

The theater is also prized for its acoustics, a fact that would seem to make the house a good home for musicals.

For its recently announced 2009-10 season, though, Broadway/San Diego will present only one show at the 1,338-seat Balboa (“Cirque Dreams: Illumination,” running April 13-18, 2010), compared with seven at the 2,967-seat Civic.

Diane Willcox, Broadway/San Diego's general manager, says that lopsided equation is not necessarily a permanent pattern.

“It's a balance in terms of what we think the show needs from an artistic standpoint – both the size of the stage and the technical capacities,” Willcox says. “The technical capacities are extraordinary, but the stage itself is small. You also weigh that with the size of the audience and what serves the piece best.”

Although the theater had its technical limitations even for “Spring Awakening” (not only is the stage small, but the place has almost no rehearsal space to speak of), the Balboa's coziness can be an advantage at times.

“Artistically, the energy created from the small space for what was happening onstage was perfect,” says Willcox. “The intimacy was needed. And there will always be shows for which that intimacy is really important.”

Eclectic mix

San Diego Theatres also presents its own programming at the Balboa. Those shows have been all over the map (thematically and geographically), from the Shanghai Circus to the Vienna Boys Choir to Dublin's Irish Cabaret to a performance by Jungle Jack Hanna, the American-born zookeeper-turned-showman.

What the Balboa hasn't seen much of are rock or pop-music shows, which are regular parts of the entertainment mix at other downtown venues such as the 1,000-seat House of Blues and (to a lesser extent) the 1,450-seat Spreckels Theatre.

“We would welcome them,” Telford says. “We've held various dates for different types of artists. For whatever reason, they ended up not touring or not routing through San Diego.”

(He mentions a 2008 concert by the veteran Broadway performer Betty Buckley as one example of pop at the Balboa.)

For a nonprofit, going up against established commercial operations for pop bookings can be a challenge in any economic climate, says Gary Bongiovanni, editor of the concert-industry trade magazine Pollstar.

“There's a lot of competition there,” he says. “And with the House of Blues, you've got (gargantuan corporate owner) Live Nation, which is trying to steer everything they can in that capacity range to their facility.

“That may not leave a lot of prime talent for a nonprofit to try and scoop up a show occasionally.”

But Telford is not convinced competition is the issue.

“There was a lot of concern early on about whether the Balboa would cannibalize the market,” says Telford. “I think what the Balboa really has done is provided an alternative (to other venues) that is certainly serving its mix.”

According to San Diego Theatres figures, total attendance at the Balboa from January 2008 through March of this year was 98,981. That was for a total of 108 performances. In the theater's first six months, 94 percent of its uses were classified as nonprofit, government or educational, vs. 6 percent for commercial.

Those figures shifted to 47 percent nonprofit/government/educational and 53 percent commercial from July 2008 to March 2009, largely because of the run of “Spring Awakening.”

With its one-of-a-kind twin waterfalls, bold color scheme and gorgeously restored interior, the Balboa has won scads of design and urban-renewal awards, and sits like a proud jewel near the northeast corner of Horton Plaza.

From where Telford sits, in an office just off the audience chamber, the recent troubles haven't tarnished that jewel, or the reasoning behind its restoration. But they have pointed up lots of room for improvement.

“It's a public venue,” Telford says. “Our role is we're stewards of these publicly owned buildings. We do the best we can managing them and operating them on behalf of the community. Financially, this operation hasn't turned out the way we hoped or wanted. And long-term, that is not something that we could maintain.

“We went into this without any financial support from the city or from the redevelopment agency” – terms he has no problem with, Telford adds. Still, “that's an unusual business model to take. And it may not be something that's viable long-term.

“I think we just need to work through this and see where things can head in the future.”

“Our role is we're stewards of these publicly owned buildings. We do the best we can managing them and operating them on behalf of the community.”